Employee or VA?


Just a reminder: If you are setting your assistant’s rate or dictating their hours and manner of work completion, they aren’t a VA – they’re a teleworker or home-based employee.

One defining feature of a VA is that they are SELF-EMPLOYED. That means – among other things – they:

  • set their rates
  • set their hours of work
  • determine the method of work completion
  • can work for others
  • have an ABN
  • provide their own equipment and office space

– they are for all intents and purposes independent of you.

If you employ someone to assist you but ask them to get an ABN, control their work flow and work performance, dictate what you’ll pay them, or prevent them from working for others, yet ask them to invoice you for work performed, you could be breaking the law. Use the ATO’s Employee/Contractor decision tool to help you work it out. You can find it here!

For a handy definition of what a Virtual Assistant is:

“A VA is a business owner – a highly-skilled, independent professional entrepreneur who provides remote administrative, technical and/or creative business support services to clients locally, nationally or globally.”

You can also read our article on what a VA really is!

©Lyn Prowse-Bishop – www.execstress.com


  1. Michelle says:

    What a coincidence! I was just thinking to myself that I really need to look into the legalities of engaging a sub-contractor.

    I’m starting to get snowed under but was always put off by my perception that I would be breaking some rules with regards to employee vs contractor. Someone told me that if I invoiced my client for the services of a sub-contractor that the subbie was then classified as my employee. That never made sense to me though, so I’m happy that you’ve pointed me in the direction of some good info. Thanks Lyn!

  2. execva says:

    No worries. I’ve used subbies before and they were never classed as employees – but ensure you have a subcontractor contract in place with them. Also there is the risk of the 80/20 rule thing kicking in – if they are working only for you – or mostly for you – even if they are legitimately a subcontractor IC, there is the chance the ATO could view them as your employee anyway. This was something that we were trying to get overruled because what happens if you’re a VA just starting out? Necessarily you will only be getting your work from one place initially. But there are now about 20 tests the ATO applies and it’s looked at on a case by case basis. This tool is a place to start however!

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